GRM is a rough screening tool: lower is better (you pay less per dollar of rent). It ignores vacancies and expenses, so use the cap rate for a fuller picture. GRMs of 4–7 are often considered attractive.
How to use the Gross Rent Multiplier Calculator
- Property price
- Gross rental income
- Market GRM for comparison
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the property price and the gross rent (monthly or annual), and a typical GRM for the area.
Tips
- Get a written loan estimate and compare the APR, not just the interest rate.
- Include property tax, insurance, HOA fees and maintenance in your monthly budget.
- A larger down payment lowers the payment and can remove mortgage insurance.
- Rates change daily – use a current quote for the most accurate result.
Common mistakes to avoid
- Looking only at the monthly payment instead of the total cost of the loan.
- Forgetting closing costs and fees.
- Assuming home prices always rise.
Inputs explained
| Field | What to enter |
|---|---|
| Property price | Amount in your currency |
| Gross rental income | Units: per month, per year |
| Market GRM for comparison | A number |
What each result means
- Gross rent multiplier = [Property price]÷[Gross rental income]
- Value at the market GRM = [Market GRM for comparison]×[Gross rental income]
Example values
How the main result changes when Property price changes and everything else stays at the example values above:
| Property price | Gross rent multiplier |
|---|---|
| 300,000 | 5.56 |
| 450,000 | 8.33 |
| 600,000 | 11.11 |
| 750,000 | 13.89 |
| 900,000 | 16.67 |
| 1,200,000 | 22.22 |
Formula
GRM = property price ÷ gross annual rentValue = market GRM × gross annual rentWorked example
Inputs — Property price: $600,000; Gross rental income: $4,500 per month; Market GRM for comparison: 10.
Results — Gross rent multiplier = 11.11; Gross annual rent = $54,000.00; Value at the market GRM = $540,000.00.
Frequently asked questions
What is a good GRM?
Lower is better; 4–7 is often considered good, but it varies by market.
How is GRM different from cap rate?
GRM uses gross rent and ignores expenses; cap rate uses NOI.
Should I use monthly or annual rent?
Annual is standard – this calculator converts monthly rent.
What formula does the Gross Rent Multiplier Calculator use?
GRM = property price ÷ gross annual rent.